AP (DIR) circulars from March 2009 to April 2009

issued since last customer service meet

A.P. (DIR Series) Circular No.57 dated 09.03.2009-Memorandum of instructions governing money changing activities – The instructions governing money changing activities issued to AMCs duly reviewed are enclosed in the Annexure.

A.P. (DIR Series) Circular No.58 dated 13.03.2009 – As per A.P. (Dir Series) circular No.39 dated 8.12.2008, entire procedure for buyback of FCCBs was to be completed by 31.03.2009.It has been decided to extend the date for completing the entire procedure of buy back of FCCBs from 31.03.2009 to 31.12.2009.

A.P. (DIR Series) Circular No.60 dated 26.03.2009 – On-line downloading of GR forms –

At present, GR Forms [to be completed in duplicate for export otherwise than by Post including export of software in physical form i.e. magnetic tapes / discs and paper media] can be obtained by the exporters from the Regional Offices of the Reserve Bank at the cost of Re.1.As part of simplifying the procedures, it has been decided to make the GR Forms available on-line on the Reserve Bank’s website www.rbi.org.in.Accordingly, the exporters have the option to use the GR Forms available on-line as well.While downloading the GR-Forms, the exporter may ensure to use “Legal size paper i.e. 8.5 * 14 inches.Further, both the printer (printing preference) and the paper size in the page set up option have to be set to legal size before printing.The GR number will be automatically allotted when the document goes to the print queue.

A.P. (DIR Series) Circular No.62 dated 20.04.2009 – External Commercial Borrowing Policy-Liberalisation – Issue of Guarantee for operating lease – As a further measure of rationalization, it has been decided to allow AD Category – I banks to convey ‘no objection’ from the Foreign Exchange Management Act (FEMA), 1999 angle for issue of corporate guarantee in favour of the overseas lessor, for operating lease in respect of import of aircraft / aircraft engine / helicopter.

A.P. (DIR Series) Circular No.63 dated 22.04.2009 – Foreign Direct Investment in India –

Transfer of Shares / Preference Shares / Convertible Debentures by way of Sale – Modified Reporting Mechanism – Revised guidelines have been issued.

A.P. (DIR Series) Circular No.64 dated 28.04.2009 – External Commercial borrowing-Liberalisation – As announced in para 107 of the Annual Policy Statement 2009-10 and considering the continuing pressure on credit spreads in the international markets, it has been decided to extend the relaxation in all in cost ceiling, under the approval route up to 31.12.2009.

A.P. (DIR Series) Circular No.65 dated 28.04.2009 – As announced in Para 110 of the Annual Policy Statement 2009-10 and keeping in view the benefits accruing to the Indian companies, the current policy has been reviewed and it has been decided to increase the total amount of permissible buyback of FCCBs, out of internal accruals, from USD 50 million of the redemption value per company to USD 100 million, under the approval route by linking the higher amount of buyback to larger discounts.Accordingly, Indian companies may henceforth be permitted to buyback FCCBs up to USD 100 million of the redemption value per company, out of internal accruals, with the prior approval of the Reserve Bank, subject to a:

i)minimum discount of 25 per cent of book value for redemption value up to USD 50 million;

ii)minimum discount of 35 per cent of book value for the redemption value over USD 50 million and up to USD 75 million; and

iii)minimum discount of 50 per cent of book value for the redemption value of USD 75 million and up to USD 100 million.

A.P. (DIR Series) Circular No.66 dated 28.04.2009 – Loans to Non-residents/third party against NRE/FCNR(B) accounts – As announced in Para 111 of the Annual Policy Statement 2009-10, it has been decided to enhance the existing cap of Rs.20 lakh to Rs.100 lakh on loans against security of funds held in NR(E)RA and FCNR(B) deposits either to the depositors or third parties.